BERLIN, Sept. 14 (Xinhua) — A “pronounced economic recovery” was recorded in many major economies, in particular in China, during the summer months, the German think tank Economic Institute (IW) said Monday in its autumn forecast.
If the recovery was not interrupted by further lockdowns, “global economic activity and world trade may reach pre-crisis levels towards the end of 2021,” according to the IW’s forecast.
Real gross domestic product (GDP) in Germany is expected to decline by almost 6.25 percent in 2020 compared to the previous year and would grow by almost 4.5 percent in 2021, according to IW.
For the United States, IW is forecasting its GDP to drop by five percent in 2020, followed by a growth of four percent in 2021.
As a result of health policy measures and the manifold effects on supply and demand of the economies affected worldwide in the second quarter of 2020, the COVID-19 pandemic “adversely affected global economic activity to an extent unparalleled in the last seven decades,” IW noted.
In China, the official purchasing managers’ index for the manufacturing sector started rising in March, as well as other indicators such as the development of exports of German goods to China or new registrations in the automotive sector also pointed to a “revival of the Chinese economy,” the IW said.
In July, German exports to the United States, which was “hit particularly hard by the coronavirus pandemic,” dropped by 17 percent year-on-year, according to the Federal Statistical Office (Destatis) last week.
German exports to China had almost reached last year’s level and only decreased by 0.1 percent to 8.7 billion euros (10.3 billion U.S. dollars) in July, according to Destatis.
“After the historic collapse of trade relations between China and Germany in the first quarter of 2020, there has been a strong recovery in trade relations since June 2020,” Lisandra Flach, head of the center for international economics at the ifo Institute told Xinhua last week. Enditem